[Tichy]

"which yes will make it cost more than a paperback while ebooks remain a secondary release"

You mean because paperbacks use the formatting from the hardcover edition, so their formatting comes for free?

I am still not convinced that your maths is really set in stone. For example, does the retailer still need to get 40%? Editors and proof readers are the same for ebooks as for paperbacks, hopefully.

How hard is the formatting of an ebook, what does it entail? I don't think they can just add new paragraphs? Couldn't the process be automated (LateX seems to be doing quite well with automated layout?

[nikgregory]

Actually Latex does a pretty crappy job routinely producing widows and orphans. The only way to change this seems to screw up the pagebreaking.

When was the last time you saw a widow or orphan in a book? I'll bet never for one from a major printer.

There are many things done in books to hugely improve readability that all have to be re-learnt and redone.

Also, yes paperbacks can use the same formatting as the hardcover if the page proportions are the same. Just an FYI hardcovers usually have larger fonts and the page can sometimes simply be scaled down without screwing anything up. So yes, sometimes it is free.